The world’s No. 1 auction Website, Ebay is showing weakness in its core auction revenue with no indication of improving conversion rates, despite lower listings, according to Piper Jaffray analyst Safa Rashtchy.
“Investors should focus on user monetization and marketing efficiency metrics,” writes Rashtchy.
The investment banking analyst noted that listings were down 8 to 11 percent over its estimate.
Rashtchy said that, “Ebay’s revenue per auction has been $1.65, we expect it to be $1.73 in Q4; for a full recovery, revenue per auction should be above $1.82.”
Rashtchy noted that revenue per active users, a true metric of Ebay’s ability to monetize its user base, has been trending down since the first quarter of 2004 and is now at $12.01. Piper Jaffray says that Ebay would need to see $13 before a reversing trend would exist.